Climate change and macro prices in Nigeria : a nonlinear analysis

The study analyses the impacts of climate change on macro prices (food prices, interest rate, and exchange rate). Secondary data from 1960-2019 are used, and the nonlinear autoregressive distributed lag method is employed accordingly. The results reveal that there is a long-run relationship among the variables employed. In addition, asymmetry only exists between food prices and exchange rate in the short run while it only subsists for all macro prices, except interest rate as a dependent variable, in the long run. Also, the relative effects of climate change on macro prices grade food prices with the highest effect. In fact, the continual need for climate policies in both financial and real sectors to douse the effect of climate change on macro prices cannot be overemphasised. Therefore, this study recommends that the Nigerian government and policymakers should ratify and pursue policy initiatives and strategies based on both negative and positive changes in macro prices.